Last few days for UK firms, funds and managers operating in Luxembourg to notify the CSSF if they wish to continue to operate in Luxembourg after Brexit

United Kingdom

09/12/2019

eversheds sutherland.

Introduction
Earlier this year, Luxembourg’s financial services regulator, the Commission de Surveillance du Secteur Financier (the “CSSF”) announced a year-long transitional period starting 31 October 2019 during which UK financial firms can continue their current activities in Luxembourg (under the EU passport for financial services) after a no deal Brexit. Following this 12 months’ period, UK firms will have to be duly authorised by the CSSF if they wish to continue to operate in Luxembourg.
In order to be entitled to benefit from the transitional regime, UK firms that are planning to continue to serve existing contracts in Luxembourg under the transitional regime, need to notify the CSSF accordingly using the dedicated notification forms on the CSSF website.
To visit the CSSF website, click here.

Who is affected?
Firms authorised under CRD IV, MiFID II, PSD 2 or EMD in the UK as well as funds and their managers who currently use the passporting rights in the EU Directives to provide financial services in Luxembourg, to the extent those firms, funds and managers wish to continue to provide such financial services in the event of a no deal Brexit.

When must they notify?
By 15 September 2019 to benefit from the 12 month transitional period
The transitional period will to ensure the continuity of contracts entered into before the date of Brexit and of contracts entered into after the date of Brexit that have a close link with pre Brexit contracts.
By 31 October 2019 if planning to continue to offer services in Luxembourg after the end of the transitional period
Firms, funds and managers wanting to provide services in Luxembourg after the end of the transitional period must submit an application for authorisation by 31 October 2019.
The CSSF set these notification dates on the assumption there will be a no-deal Brexit on 31 October 2019.

The notice
When giving notice, firms, funds and managers must include details of their UK licence and their plans during the transition period and thereafter.

Missed deadline?
If notification is not given by the relevant date, the relevant firms, funds and managers will be ineligible to benefit from a transitional period and will have to cease all business as of the date of the no-deal Brexit. Failure to do so will put those firms, funds and managers in breach of CSSF regulations.

How Eversheds Sutherland can help
Since June 2016, our lawyers and consultants have advised various institutions passporting into the UK from EU27 Member States and passporting from the UK into the EU27 on Brexit planning and Brexit related issues.
We would be happy to discuss how we can help you with your Brexit planning and execution of those plans.
If you require any assistance in submitting an authorisation application or notification, the investment funds team at Eversheds Sutherland Luxembourg would be happy to assist.